Bill > HB1670

This bill modifies Missouri state income tax law by adding a provision that allows tipped employees to exclude 100% of their tips from state income tax starting in the 2027 tax year. Specifically, the bill defines "tips" using the federal Fair Labor Standards Act definition and "tipped employee" as workers who customarily and regularly receive tips. The bill stipulates that employers will not be required to withhold income tax on tips except as mandated by federal law. This change means that service workers like restaurant servers, bartenders, taxi drivers, and other workers who receive gratuities will not have to pay Missouri state income tax on those tips. The provision is part of a broader section of tax law that outlines various additions and subtractions to a taxpayer's federal adjusted gross income when calculating Missouri state income tax. By exempting tips from state income tax, the bill aims to provide financial relief to workers in tip-based occupations.

https://house.mo.gov/Bill.aspx?bill=HB1670&year=2026&code=R